A Recessionary Gap

question 102

Multiple Choice

A recessionary gap:

• A)is of little consequence in a capitalist economy.
• B)represents actual physical output lost.
• C)implies an equilibrium level of output less than the full-employment level.
• D)is associated with rising labor prices.
• E)will automatically close, according to the Keynesian model.

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Definitions:

Agency

A relationship where one party (the agent) is authorized to act on behalf of another (the principal) in legal or business matters.

Third Parties

Entities not primarily involved in a transaction or legal contract but who may be affected by it or have interests in its outcome.

Law Of Agency

A legal doctrine concerning the relationship between the agent and the principal, where the agent is authorized to act on behalf of the principal.

Quasi-Contract

A legal concept where the courts impose contractual obligations on parties not in an actual contract to prevent unjust enrichment.